Tax credit awards

How do tax credits work out what to pay me?

The tax credit system works out an award which covers a period of up to a year long, unlike the rest of the benefits system. If you claim part-way through a tax year, your award will be worked out for the period up to and including 5 April of that tax year. You will normally be paid every four weeks or every week. The Tax Credit Office spreads out your award over what is left of the tax year. This means that you may not be paid the same every time.

You can have a look at How tax credits are worked out? to get a better understanding of your award.

If you use the tax credit calculator on the GOV.UK website, it will give you a figure worked out from the date you are using it until the end of the tax year. This means it may not give a result which is exactly the same as the money you actually get, or the figures on your award notices. This is because your actual award takes into account money the Tax Credit Office has already paid you.

At the end of the tax year your tax credit claim is finalised. It is important to respond to any requests for information you receive in order to make sure you are not overpaid. Usually this process also forms your claim for tax credits for the new tax year.

If you are moving to Universal Credit (UC), your tax credit award stops the day before your UC starts. You will get a letter from HMRC asking you to finalise your tax credit award based on your circumstances and income for the part of the tax year up until your UC award starts.

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